Dodd-Frank Title VII is a legislation that governs the operations of swap markets, which involve the exchange of financial assets between two parties. This law grants the Commodity Futures Trading Commission (CFTC) the authority to oversee most swaps, while security-based swaps are regulated by the Securities and Exchange Commission (SEC). Title VII mandates certain swaps to be cleared by a clearinghouse and executed on an electronic platform. Dealers and major participants are required to register with both the CFTC and the SEC and adhere to reporting obligations. Additionally, the law imposes business conduct, capital, and margin requirements on dealers and major participants. The primary objectives of Title VII are to enhance transparency, foster market integrity, and mitigate the risk of financial crises.
Title VII of the Dodd-Frank Act is a regulatory framework that governs swap markets. It grants the Commodity Futures Trading Commission (CFTC) the authority to regulate swaps, excluding security-based swaps which are overseen by the Securities and Exchange Commission (SEC). The main objectives of Title VII are to enhance transparency, promote market integrity, and mitigate risk in swap and security-based swap transactions. This is achieved through the requirement for certain swaps to be cleared by a clearinghouse and executed on an electronic execution facility. Additionally, dealers and major participants are subject to registration requirements. The availability of data from swap and security-based swap data repositories enables regulators to make well-informed decisions, while increased reporting requirements and pricing information contribute to greater price efficiencies in swap markets. Key provisions of Title VII include the regulatory authority of the CFTC over swaps, the imposition of registration requirements on various market participants, the establishment of electronic swap and security-based swap execution facilities, and the obligation for cleared swaps to be submitted to regulated and registered data repositories. An example of how Title VII applies is when a company seeks to hedge against the risk of rising interest rates by entering into a swap agreement with a bank. The bank, as a swap dealer, must comply with Title VII regulations, including registration, clearing, and execution on an electronic platform. The bank is also required to adhere to business conduct, capital, and margin requirements, as well as submit swap transaction data to a regulated and registered swap data repository.
Dodd-Frank Title VII is a section of the Dodd-Frank Wall Street Reform and Consumer Protection Act that aims to increase transparency and accountability in the financial markets.
Dodd-Frank Title VII regulates the over-the-counter derivatives market, including swaps and security-based swaps.
A swap is a financial contract in which two parties agree to exchange cash flows based on a predetermined set of conditions.
A security-based swap is a type of swap that is based on a security, such as a stock or bond.
The purpose of regulating swaps and security-based swaps is to increase transparency and reduce risk in the financial markets.
Swap dealers, major swap participants, and security-based swap dealers are required to comply with Dodd-Frank Title VII.
Swap dealers and major swap participants are required to report swap data to a registered swap data repository.
Swap dealers and major swap participants are required to maintain records of all swap transactions.
The Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) have the authority to enforce Dodd-Frank Title VII.
Penalties for non-compliance with Dodd-Frank Title VII can include fines, suspension or revocation of registration, and other sanctions.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.
- Page URL:https://dlssolicitors.com/define/dodd-frank-title-vii-wall-street-transparency-and-accountability/
- Modern Language Association (MLA):Dodd-Frank: Title Vii – Wall Street Transparency And Accountability. dlssolicitors.com. DLS Solicitors. May 09 2024 https://dlssolicitors.com/define/dodd-frank-title-vii-wall-street-transparency-and-accountability/.
- Chicago Manual of Style (CMS):Dodd-Frank: Title Vii – Wall Street Transparency And Accountability. dlssolicitors.com. DLS Solicitors. https://dlssolicitors.com/define/dodd-frank-title-vii-wall-street-transparency-and-accountability/ (accessed: May 09 2024).
- American Psychological Association (APA):Dodd-Frank: Title Vii – Wall Street Transparency And Accountability. dlssolicitors.com. Retrieved May 09 2024, from dlssolicitors.com website: https://dlssolicitors.com/define/dodd-frank-title-vii-wall-street-transparency-and-accountability/
Our team of professionals are based in Alderley Edge, Cheshire. We offer clear, specialist legal advice in all matters relating to Family Law, Wills, Trusts, Probate, Lasting Power of Attorney and Court of Protection.
All author posts